“I haven’t sold a single unit since September. My sales target is out of the question.”
Ms. Chen, a salesperson at a property project in Nanjing, is utterly helpless as her sales office remains nearly empty. The traditional peak sales season known as “Golden September” is more than halfway over, yet Nanjing’s property market has turned in a dismal performance, with transaction volumes down by over 50% compared to the same period last year.
Nanjing is far from alone—China’s traditional real estate market as a whole has entered a deep freeze. According to a survey report from the China Index Academy, property prices and sales volumes across the country have both declined from January to August this year.
In addition, the growth rate of real estate investment has fallen by 0.5 percentage points, marking a continuous decline for seven months in a row.
The “fading” of the traditional real estate sector has prompted many leading developers to pivot toward a new frontier—tourism property. However, while this emerging field offers vast opportunities, it is also riddled with chaos. So how can developers “ride the wave of tourism property while delivering true quality and refinement”?
Traditional real estate cools down; industry transformation is imperative
Beyond the impact of the “New State Council No. 4 Policy” and subsequent measures, shifts in the macroeconomic landscape and the surfacing of deeper contradictions in the property market have collectively acted as a “cooling agent” for what was once a red-hot residential housing market. Scenes of “units selling out on opening day” or “customers queuing overnight to snap up numbers” are now a thing of the past. The once-glorious “land kings” and “tower kings” are now facing an awkward situation. Reports say that Guangzhou’s Asian Games City, once the “most expensive land deal in China,” saw a sudden price plunge in June this year. Similarly, the land parcel at Beijing’s Xiajia Hutong, which was sold last year at a record-breaking floor price of over 40,000 yuan per square meter, now sees surrounding new and second-hand home prices having dropped to around that same level.
Having enjoyed a golden decade of rapid development, the traditional real estate industry is now facing an unprecedented cold spell. Developers must not only grapple with the immediate pressure of rapidly digesting inventory and recouping funds for survival, but also consider the long-term challenge of transforming and rescuing themselves. Well before the turbulence began, some forward-thinking developers had already abandoned hopes of government “bailouts” and turned their focus to a new area—tourism property.
Policy tailwinds drive industry giants to converge on tourism property
Dalian Wanda made a high-profile entry into tourism property; Evergrande launched tourism property projects in cities such as Wuhan and Chengdu; Shimao Group aims to spin off its tourism property division for a separate IPO; China IPP Investment Management poured huge sums into creating the independent cultural tourism brand “Shinho World” International Resort… Statistics show that over one-third of the top 100 real estate companies have already dipped their toes into this new field.
Not only are the numbers of developers entering tourism property substantial, but so are their investments. Take China IPP Investment Management as an example. After announcing in July a cooperation agreement with Shanghai Film Group to develop film-and-tourism property, Jin Jie, board secretary and vice president of China IPP, said in an interview that the company has already invested in tourism property projects in multiple provinces and cities including Beijing, Shandong, Yunnan, and Hainan, and plans to continue expanding. It is expected that by the end of this year, projects under the “Shinho World International Resort” brand, such as Beijing Yuma Fang and the Changbai Mountain project, will be launched.
Why do developers have the courage to pour massive investments into tourism property? The arrival of the leisure era and the growing demand for tourism and leisure consumption are at the core of this trend. Meanwhile, policy directions that place increasing emphasis on people’s livelihoods and the concept of “putting people first” have also served as a strong boost.
As early as the rollout of the 12th Five-Year Plan in 2012, it was clearly stated that “cultural tourism will be developed into a strategic pillar industry of the national economy.” In July this year, the Premier presided over an executive meeting of the State Council to directly plan the development of tourism, proposing to “promote the transformation and upgrading of tourism, shifting tourism products to a balance of sightseeing, leisure, and vacation, and enhancing tourism services toward higher quality and efficiency.” In August, the State Council issued the “Several Opinions on Promoting the Development of Tourism,” which emphasized “integrating tourism with various industries” and “further tilting land supply toward tourism”—measures seen as key positive signals for tourism property to “set sail on the wind.”
Relying on superior natural resources and integrating modern service sectors such as tourism, vacation, wellness, elderly care, and cultural experiences, tourism property is undoubtedly a key direction for industrial development in the context of new urbanization. It is also one of the important pathways for upgrading China’s economy, naturally becoming a much-anticipated transformation direction for many real estate companies.
Tourism property must leverage its “name” to deliver real value
Although tourism property is currently riding high on favorable winds, any industry aiming to rise rapidly must possess its own core competitiveness—unique and advanced business models and fresh concepts—in order to earn recognition from the market and the public, and to truly create outstanding tourism property offerings. Leading real estate firms, including China IPP Investment Management, hope to gain a first-mover advantage in this wave of tourism industry development through strategic vision and meticulous execution.
Take China IPP Investment Management as an example. The company is fully committed to building the “Shinho World International Resort.” Targeting primarily family-oriented consumers, “Shinho World” is dedicated to developing comprehensive, compound leisure property products that integrate tourism and vacation, theme parks, cultural leisure, health and wellness, and high-end commerce. Its brand philosophy of “A New Fun Place for the Whole Family” deeply understands the challenges faced by Chinese families: on one hand, there is a growing demand for leisure and vacation; on the other, there is a market gap for “one-stop family vacation” products. This contradiction leaves Chinese families, who value kinship and ethics, struggling to find suitable travel options.
The “Shinho World International Resort” addresses these fundamental needs by bringing together the diverse vacation joys of each family member. The organic integration of themed parks, high-end commercial and business zones, elderly care and wellness, and vacation residences allows both children and parents to enjoy their own interests while also coming together for joyful moments. Only products that truly meet market demand can stand undefeated in a sea of homogenized competition.
In addition, tourism property demands stronger resource integration capabilities, as well as higher-level planning and operational skills from developers. “Shinho World” features a diverse mix of business formats, including both saleable and holding properties. China IPP Investment Management has long recognized that its role must evolve—from being a mere developer and seller to becoming an asset manager, service provider, industry operator, and even urban operator. The strength of its listed corporate background and its forward-looking transformation strategy have laid a solid foundation for this role transition.
Although tourism property is currently experiencing strong momentum, China still lacks mature models in this field. Seizing the recent policy tailwinds to quickly establish models, form chains, and expand nationwide is the key to capturing greater market share and gaining a first-mover edge.